Audit 385343

2025-001 : Assistance Listing No. 14.239 HOME Investment Partnerships Program Special Tests and Provisions - Housing Quality Standards Criteria: During the period of affordability (i.e., the period for which the nonfederal entity must maintain subsidized housing) for HOME assisted rental housing, the participating jurisdiction must perform on-site inspections to determine compliance with property standards and verify the information submitted by the owners no less than: (a) every three years for projects containing one to four units, (b) every two years for projects containing 5 to 25 units, and (c) every year for projects containing 26 or more units. The participating jurisdiction must perform on-site inspections of rental housing occupied by tenants receiving HOME-assisted tenant-based rental assistance to determine compliance with housing quality standards (24 CFR 92.209(i), 92.251(f), and 92.504(d)). Condition: Of the 10 properties tested, one was out of compliance as an inspection should have been completed by October 2024. Cause: The Organization is responsible for contacting the City of Salem (the City) and Oregon Housing and Community Services (OHCS) to schedule the inspections timely but there were delays caused by the COVID-19 pandemic. Effect: Units could be out of compliance with housing quality standards. Questioned Costs: None Recommendations: We recommend the Organization set up a schedule and tracking system in order to contact the City and OHCS in advance of the due date of inspections in order to allow the City and OHCS sufficient time to complete the inspections timely. Views of Responsible Officials and Planned Corrective Actions: See corrective action plan included in report.

2025-002 : Assistance Listing No. 21.027 Coronavirus State and Local Fiscal Recovery Funds (SLFRF) Allowable Activities and Allowable Costs Criteria: In accordance with the Uniform Guidance (2 CFR Part 200) and the U.S. Department of the Treasury Compliance and Reporting Guidance for ALN 21.027, recipients of SLFRF funds are required to ensure that all transfers or subawards of federal funds comply with applicable allowability requirements. Condition: The Organization transferred a portion of the money received to PSLLC, which is outside of compliance requirements. Cause: The condition occurred due to inadequate internal controls over the review and approval of fund transfers, including insufficient understanding of SLFRF compliance requirements and a lack of formal procedures to assess compliance prior to transferring funds. Effect: As a result, SLFRF funds were used in a manner not in compliance with federal requirements, which may result in questioned costs, potential repayment of funds to the granting agency, and increased risk of noncompliance with federal grant regulations. Questioned Costs: $16,000 Recommendations: We recommend the Organization set up a system to review transfers of federal funding prior to the transfer taking place to ensure it is within the compliance requirements of the grant. Views of Responsible Officials and Planned Corrective Actions: See corrective action plan included in report.